Real Estate
US Commercial Real Estate Contagion Is Now Moving to Europe
- Bonds at Deutsche PBB suffer over bank’s property exposure
- Warning signals from US to Asia have multiplied recently
The troubles in the US commercial property market, which have already hit banks in New York and Japan, moved to Europe this week, elevating fears about broader contagion.
The latest victim was Germany’s Deutsche Pfandbriefbank AG, which saw its bonds slump on concern about its exposure to the sector. It responded by issuing an unscheduled statement Wednesday that it had increased provisions because of the “persistent weakness of the real estate markets.”